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May 17th, 2017

Property Disputes Involving Family Members

Property disputes between brothers and sisters or other family members can cause hostility and long-term or permanent damage to relationships. Whether property is jointly inherited or purchased, ensuing conflict and controversy can lead to indelible problems.

By working with a lawyer experienced in family property disputes, you gain the best opportunity to resolve the cause of the dispute as quickly and effectively as possible.

Inherited Property

The passing of land to heirs under a will or to surviving joint tenants after a family member dies, creates the potential for a dispute over the future management and ownership of the land. This is because two people, even if they share the same goals for the land when they acquire it, may, as time goes on, develop diverging ideas as to what should happen to the property. When the land is inherited, the heirs may from the outset have very different plans given each of the new owners’ financial needs and life plans.

In addition, given the emotional ‘baggage’ that every family has, there is also the potential for family members to differ on what the deceased parent wanted with respect to the property and the heirs themselves may carry longstanding resentments into their new relationship as co-owners of their parents family home or vacation property.

Although many families can amicably deal with these issues including making consensual decisions on the sale or continued joint ownership of land, some do not with the result that disputes cannot be resolved without the assistance of a lawyer.

Property Purchased with a Family Member

In some cases, siblings, cousins or other family members knowingly and willingly purchase property together. The reasons for such purposes are varied and include investing in real estate, sharing a vacation property and even shared ownership and occupation of a residence in locations such as Metro Vancouver where the single family housing supply is limited and very expensive.

However, like inherited property, these joint purchase and ownership arrangements can lead to disagreement and disputes and being related by blood to a co-purchaser is no insurance against a deal going sour. Again, the assistance of a lawyer with experience in resolving those disputes involving family members over land may be required.

Land Ownership Categories

If you are ‘put on title’ or decide to buy property with family members, understand that you are entering into a situation of co-ownership. Types of co-ownership include:

Joint Tenancy, where the owners share equally in the ownership of the land and when one co-owner dies, that person’s interest in the land automatically transfers to the surviving co-owner(s). In joint tenancy, ownership transfers without going through probate, and neither party can ‘will’ their part of the property to heirs. Tenancy in Common, which can give owners an equal or differing share. In tenancy in common, one owner can sell their portion without getting permission from the other owners. This type of ownership provides for having more than two owners, and each owner can sell their share at any time and to anyone, unless the contract provides for different rules. In addition, if a tenant in common dies, his or her interest in the land forms part of their estate and will pass to the heirs of that person.

Joint Tenancy Poses Special Problems

Individuals who own property sometimes use joint tenancy to add a family member to the title as an estate planning tool. If one of the parties dies, the other person becomes the sole owner.

Many cases related to joint tenancy have worked their way through the Canadian courts, in part because each involved property owner can end a joint tenancy and end survivorship rights. Family members sometimes sue over misunderstandings or to retain their control of the property.

In 2013, for example, the Court of Appeal for British Columbia heard a case in which a couple asked their son to build a house on their investment property, and they set up a joint tenancy that they later severed following a conflict.

The parents believed their son would eventually inherit the property, but he believed it was a gift to pass to him immediately even though his parents were alive. The parents initiated legal action, and the court ruled in their favor. However, the relationship between parents and son deteriorated.

Family Property Dispute Lawyers Can Assist You

If you’re involved in a family property ownership dispute with a sibling or another family member, you need experienced legal representation to help you resolve the situation as quickly as possible. To schedule a consultation, please contact McLarty Wolf.